In Singapore, the merchants always practice the habit of adding the 3% credit card charges back to the total amount if the buyer pays by credit card. This is because of the thin margin from selling electronic goods in a brick and mortar shop as opposed to a restaurant or service offerings.

I wonder if VPASP could add an option for merchants to add a certain percentage (depending on which payment gateway he uses) to the total sales amount if they choose to pay by VISA.

This could appear in the very last line at the checkout page to reflect this add-back.

The cart would need to asses the fee after the customer enters their card information since you won't know if they are using a VISA or not until that point. The problem with that is that they will never see the "final" price until after the card is processed and they get to the receipt page (shopthanks.asp).

If you are going to charge the fee to all credit cards -- regardless of type -- you could do that with just a small change of the code to multiply like this: (total price * percentage) + total price = FINAL PRICE.

it's not just cards which cause this kind of "don't know how much it'll be until it's been settled" problem, because, for example, if you had a worldpay account that allowed more than one currency then the user can choose any of your set of currencies to settle in on the worldpay page (regardless of what you've submitted in your gateway form as the ccy) using worldpay's current rates rather than your own and not taking account of any additional exchange costs you may encounter on your side.because of this, and because of jonmadrid's comments about choosing cards which is the same problem, jonmadrid's right in saying that you'll never know exactly how much a transaction will end up costing until after it's settled (unless you're doing absolutely all of your own card/payment processing rather than using a gateway)

i'd do what jonmadrid says and stick a premium on ALL card payments by default which'll cover the maximum extra cost, but it does depend on whether or not you're using a gateway as to how much per-card/ccy logic you can put in place on your own site.

the fact that using a gateway won't g'tee a certain card/ccy is chosen is probably why the vpasp people haven't already built in a per-card additional cost feature and just left it to individual sites how to deal with this as there are too many permutations for vpasp to create a one-size-fits-all solution.

the easiest thing to do is just to hike all your prices up to cover the maximum handling charge.

yes, that's why i'd just hike up all the cprices by, say, 5% and just leave it at that; nice and simple. if your prices are such that the margins are so narrow than a card fee can be the difference between profit/loss, then the prices are too low in my view (or costs are too high, whichever way you look at it)

That's the way to look at this is to add the 3-5% margin on your total price, the question is that do you want to take a chance of having your merchant services suspended or revoked because of adding a surcharge to a major credit card or minimize your customer base because of adding extra fees.

Not neccesarily the country but cardholder policies. If it's legal in your country then I would double check with your merchant provider. You can view a mastercard complaint form here or a visa FAQ here

It's definitely LEGAL to add a C.C. surcharge in Australia, as long as the customer is clearly informed of the surcharge prior to payment, and the surcharge amount is reasonable.

Visa and Mastercard fought against this in the Australian Court system, but they lost their fight.

Now they grudgingly accept it.

Within Australia, it's actually ILLEGAL for Visa and Mastercard to withhold or withdraw a C.C. service from a merchant, on the basis that they charge a C.C. surcharge.

The rationale is, why should someone who uses a fee-free payment method (such as direct bank deposit) subsidise the overheads incurred by the customer who pays by credit card ??

However, most companies in Australia still DON'T charge a C.C. surcharge, as they see it as generating bad customer relations.

There are a couple of notable exceptions though. QANTAS Airways and Telstra Telecommunications both charge a C.C. surcharge. But the surcharge they charge is quite low. QANTAS charge a flat 1% surcharge for all cards. Telstra's surcharge differs (between 1% and 2 %) depending on the card type, with the (Visa / Mastercard) surcharge being less than the (AMEX / Diner's Club) surcharge.

Something else merchants are doing is charging a convenience fee which is charged to all payment methods. The payment method must provide a convenience, is in a non-face-to-face environment, and is outside the merchants normal payment channel.

For example: a convenience fee id typically to customers who pay over the phone, but not to customers who go into the store or office. The convenience fee does not relate to the form of payment but rather how the payment occurs.

According to Visa, the convenience fee must be a fixed amount regardless of the amount; it cannot be a percentage of the amount paid or based on a sliding scale of the amount paid. This differs from MasterCard, which does permit percentage based and tiered rate convenience fees. The convenience fee must be disclosed to the cardholder prior to completion of the transaction. Convenience fees cannot be advertised by the merchant as an offset to the cost of accepting credit cards. There are other fees that may be added to a transaction such as a handling fee or processing fees. These fees are not part of the credit card acceptance and are added regardless of payment.